1031 Exchange in Colorado Springs, Colorado

Colorado Springs hosts several major military installations, including Peterson Space Force Base, Fort Carson, and the U.S. Air Force Academy, and that concentration of defense spending gives the local economy a stability that's rare among growth markets — demand for housing, retail, and services near the bases holds up even in broader economic downturns. Investors coming out of more cyclical markets often value that stability as much as the yield.

Because base assignments rotate personnel on predictable cycles, rental housing near the installations sees consistent turnover-driven demand rather than the boom-bust pattern tied to a single private employer, which is a meaningful distinction for multifamily investors comparing Colorado Springs against other growth markets.

The stretch of I-25 south of Denver into Colorado Springs has absorbed a wave of logistics and light-industrial development as companies look for land costs well below the Denver metro while staying on the interstate spine. Warehouse and flex product along this corridor typically trades at a meaningful discount to comparable Denver-area assets, which makes it a common landing spot for 1031 investors trading up in square footage.

New development along this stretch has also brought more modern clear-height and dock-door configurations than much of the older Colorado Springs industrial stock offers, giving exchangers access to functionally current buildings without paying Denver-core pricing for them.

Colorado Springs' faster population growth and lower land basis than Denver have made it one of the state's more active self-storage development markets, and smaller industrial and flex-space investors find entry pricing here noticeably more accessible than in the Denver metro core. That affordability is a frequent draw for exchangers who are downsizing their per-unit basis while maintaining or increasing total square footage.

We regularly see exchangers use Colorado Springs specifically to convert one higher-basis Denver-area property into two or more smaller Colorado Springs assets, spreading tenant and vacancy risk across multiple buildings instead of concentrating it in one.

Downtown Colorado Springs has seen steady reinvestment in mixed-use and hospitality product, partly fueled by the city's growing outdoor-recreation and tourism draw near Garden of the Gods and Pikes Peak. Retail and hospitality assets downtown carry more upside potential than fully priced Denver equivalents, though the market is thinner and requires more patience during identification.

We advise exchangers targeting downtown Colorado Springs to build extra time into their search for exactly this reason — thinner inventory means fewer comparable sales to underwrite against, so due diligence often takes longer than it would in a deeper market.